Mortgage lenders have launched a new price war, despite the likelihood of the Bank of England making the cost of borrowing higher. Photograph: Dominic Lipinski/PA

A fresh mortgage price war has broken out, with a string of big lenders slashing their rates in recent days.

Metro Bank, Halifax, Barclays, Nationwide Building Society, HSBC, Virgin Money, Skipton Building Society and Norwich and Peterborough Building Society are among those to change their rates. Meanwhile, Virgin Money has launched a new range that allows people to fix in for one year longer than the usual five-year deals and protect themselves against the prospect of interest rates rising for a prolonged period.

The mortgage battle comes despite expectations that the Bank of England will soon move its base rate off its historic low of 0.5%, pushing up costs for borrowers.

But David Hollingworth, head of communications at London and Country Mortgages, said that swap rates, the interest rates which lenders use to price loans, have been on a downward path.

He said: "Swap rates have been falling back and it seems the markets feel it's going to be too soon for the base rate to rise before the end of this year now.

"So you've got slightly reduced funding costs for lenders going into the autumn, when traditionally you see lenders trying to come back strongly into the market."